Piracy is progressive taxation

December 12, 2002 2:29 PM

Piracy is Progressive Taxation says Tim O'Reilly. Of the 7 lessons in this article, "Free is eventually replaced by a higher-quality paid service" is probably the best model of how things will progress.
posted by tboz (36 comments total)

Personally, I found the whole article very enlightening. O'Reilly demonstrates he's got a healthy dose of common sense, something many people involved in the P2P debate seem to lack.
posted by frog at 3:00 PM on December 12, 2002

Lesson 1: Obscurity is a far greater threat to authors and creative artists than piracy.

Absolutely! This is the issue I've felt has been overlooked all along.
posted by rushmc at 3:33 PM on December 12, 2002

Lesson 1: Obscurity is a far greater threat to authors and creative artists than piracy.

How about letting the artists make that decision for themselves?
posted by gsteff at 3:49 PM on December 12, 2002

How about letting the artists make that decision for themselves?

No kidding.

Piracy is a kind of progressive taxation, which may shave a few percentage points off the sales of well-known artists (and I say "may" because even that point is not proven), in exchange for massive benefits to the far greater number for whom exposure may lead to increased revenues.

I like that part from the article, especially his parenthetical notation, which could have easily been reversed to read as follows, shave a few percentage points off the sales of well-known artists, in exchange for massive benefits to the far greater number for whom exposure may (and I say "may" because even that point is not proven) lead to increased revenues.

Not that I'm against some form of digital media to help the arts, but saying it's a taxation because he and his daughter don't download whole albums is missing the point, because lots of people do.

I also loved the part about how their was no other avenues to find this music. No, there's just no other avenues to find the music for lazy people who want to do it from home or at the local Virgin Record Store.
posted by The God Complex at 3:57 PM on December 12, 2002

The singer/songwriter Janis Ian has covered this in great detail in her excellant article THE INTERNET DEBACLE - AN ALTERNATIVE VIEW.
http://www.janisian.com/article-internet_debacle.html
posted by thedailygrowl at 4:29 PM on December 12, 2002

No, there's just no other avenues to find the music for lazy people who want to do it from home or at the local Virgin Record Store.
Or for people who do not want to spend $18.95 for a CD they end up hating.
posted by elwoodwiles at 4:30 PM on December 12, 2002

How about letting the artists make that decision for themselves?

I think you're missing the point here. It's not a subjective "decision"; it's an objective fact. Whether Lars Ulrich likes it or not, for the vast majority of artists (including, like it or not, Lars Ulrich), obscurity is much more damaging to the pocketbook than piracy.

Your suggestion, gsteff, is akin to me saying, "It's my money, I can send as much of it to Nigeria as I want!" in response to your "Ahem, Mr. Roboto, I'm not so sure your Nigerian friend trying to get his fortune out of the country via some byzantine system involving large transfers from your account is entirely on the up-and-up." I get to keep my opinion, but that doesn't change the fact that you're right.
posted by mr_roboto at 4:45 PM on December 12, 2002

No, there's just no other avenues to find the music for lazy people who want to do it from home or at the local Virgin Record Store.
Or for people who don't live in a major city in North America. Or for people who are interested in out-of-print music. Or for people who are interested in music by groups that do not want to partake of the major label racket.

How about letting the artists make that decision for themselves?
Artists cannot make the decision for themselves as long as the RIAA shoots down alternative distribution and Internet radio channels, engages in illegal price fixing, offers artists access to their monopoly-controlled channels only if they sign long-term contracts on abusive contract terms, and then scams artists out of their money via fraudulent accounting practices.

When artists have alternative ways to make their music heard, they will make the choice for themselves.
posted by fuzz at 4:48 PM on December 12, 2002

Or for people who don't live in a major city in North America. Or for people who are interested in out-of-print music. Or for people who are interested in music by groups that do not want to partake of the major label racket.

In the latter two cases, I don't think you'll find all that much complain from anybody for downloading the music. If a music program offered the kind of sharing that only offered those types of music (on a band-by-band basis), it probably would have a legitimate shot of winning a lawsuit. Instead, they off free access to thousands of pirated songs that bands don't want available for absolutely no cost to the consumer, whether you want them or not.

As for the former, my point was major stores are not where you should look. Smaller indie stores usually have a better selection of good music anyway.

I'm not defending RIAA for the things that it does because I think there are a lot of problems that should be fixed (like you mentioned in the second part of your post), but I hardly see piracy as the best way to combat it. Being a freedom fighter at the cost of people who are trying to make a living with real art is usually just a cop out so you can get free music. Maybe not in your case, but in a large percentage of them.

Oh, and is $19 really that much money to spend on a piece of art that will, hopefully, last you many years and bring you a lot of enjoyment? It *is* possible to sample something without either downloading the entire album or shelling out cash for it. In which case, you'll have yourself a good piece of music for a decently low price. Hell, I bought a special edition of Brazil for $60 American a few months ago and that's fine by me.
posted by The God Complex at 4:59 PM on December 12, 2002

That was the most insightful thing on the topic I've read in many moons. Thanks.
posted by muckster at 5:36 PM on December 12, 2002

Oh, and is $19 really that much money to spend on a piece of art that will, hopefully, last you many years and bring you a lot of enjoyment?

well, it depends, because 99.99999999999 % of what's out there is definitely not everlasting art -- it's much, much weaker than that.

for every Blonde On Blonde or Revolver at your favorite store I can show you 100 crappy cd's -- maybe 2 or 3 good songs in each of them, the rest of the cd is filler. P2P, if at all, will do some damage to the lamer artists, the geniuses (to follow your movie -- Brazil -- example) will always thrive, Dylan won't be bankrupt by P2P, he's too good
(Radiohead put the whole latest cd online, people did download it, but it sold very very well anyway. why?)

also, try to check out what's on the hard disk of people on Kazaa or WinMx or whatever -- it's not always entire albums but it's lots of singles, lots of live performances you can't buy in stores (this is P2P greatest strenght). Almost always you can find a cd online in MP3 format before it comes out in the stores -- Pearl Jam is a recent example -- and you can evaluate it, radio only plays the single, who knows what's inside it? Many kids will just download it, many other will buy it anyway -- are you sure that the kids in the first group would have the bought the cd? They would have tried to copy it, or tape it.

Also, you have the 60 bucks for a triple DVD of a masterpiece movie, good for you. Many kids don't have that kind of money, 19 bucks for a cd it's very, very expensive, even for a masterpiece
posted by matteo at 5:54 PM on December 12, 2002

I think you're missing the point here. It's not a subjective "decision"; it's an objective fact. Whether Lars Ulrich likes it or not, for the vast majority of artists (including, like it or not, Lars Ulrich), obscurity is much more damaging to the pocketbook than piracy.

I'll let mr_roboto's comment stand as my response, since I can't improve upon it.
posted by rushmc at 6:09 PM on December 12, 2002

well, it depends, because 99.99999999999 % of what's out there is definitely not everlasting art -- it's much, much weaker than that.

Then why would you buy it? You're supporting it if you do. Don't buy it; don't listen to it.

Also, you have the 60 bucks for a triple DVD of a masterpiece movie, good for you. Many kids don't have that kind of money, 19 bucks for a cd it's very, very expensive, even for a masterpiece

It costs someone $20 to drive around in their car for five hours. Spending $20 on a wonderful cd isn't all that much money--and if it's that outrageously priced for someone's budget, maybe they should be buying something else (like food). At any rate, I doubt you'll find a lot of destitute people with access to cable modems to download songs.
posted by The God Complex at 6:28 PM on December 12, 2002

Don't buy it; don't listen to it.

well, there's a _slight_ difference between the two things
Because, surprise, many people think that 2 good songs are not worth the money for a cd, 10 or 12 are.
hence, they download a few songs -- the ones they like -- and put together a mix cd (like we used to do with tapes, once upon a time, right?)
Another example: Wilco. The whole world, everybody and his/her dog did download YHF before it came out from Wilco's website. Well, it was published and sold a lot.

I see that you insist on the "wonderful cd" argument -- I already saif that I agree, very high quality is rewarded by the market, I'm sure even the hardcore P2P users did actually buy original cd's of their favorite artists

maybe they should be buying something else (like food).

do you mean that music is for the rich and the middle class only?

I doubt you'll find a lot of destitute people with access to cable modems to download songs.

I don't know -- but even at a decent, not great quality like 128, a 4 minutes song is about 3.8 megs in MP3 -- you can also download it with a dial-up, God Complex, we're not talking about a Divx file.
And anyway, sadly, people who have modem issues usually choose low-quality rips, that are faster to download.
posted by matteo at 6:43 PM on December 12, 2002

do you mean that music is for the rich and the middle class only?

No, but if someone can't afford $20 for a CD because you have that many expenses, perhaps their priorities should be placed squarely on that and not on whether $10 or $20 is the right place for a CD.

How many people that can't afford $20 can afford a computer even with dial-up access? I'm sure there are some situations where that's a distinct possibility, but in most cases it's just an argument made by people who can afford music so they can justify why it should be freely available to them.

As I said above, I'm not against the idea of a digital medium, but I also think an artist should have some choice in whether or not their music is available on such a system.

But there's no use repeating this argument over and over so I'll leave it at that.
posted by The God Complex at 7:40 PM on December 12, 2002

Spending $20 on a wonderful cd isn't all that much money--and if it's that outrageously priced for someone's budget, maybe they should be buying something else (like food).

Ah, the compassion of the well-off. Man--even poor men--doth not live by bread alone, Mr. Complex.
posted by rushmc at 8:01 PM on December 12, 2002

Piracy is Progressive Taxation.

So how does the author feel about shoplifting?

He would have done better without the inflammatory headline, which doesn't really play a part in his argument anyway.
posted by Slithy_Tove at 8:09 PM on December 12, 2002

slithy_tove: try Lesson 4: Shoplifting is a bigger threat than piracy
posted by turbodog at 10:16 PM on December 12, 2002

So how does the author feel about shoplifting?

Read the article. He thinks it's an annoying cost of doing business. he also thinks it's a significantly greater problem then the much overblown file trading problem.

I think that the two don't compare very well. Shoplifting represents genuine loss of limited physical resources. File sharing represents a potential loss of revenue derived from an artificially constructed scarcity of supply which is granted only as an encouragement to release intellectual works for public consumption.

People really need to stop thinking about intellectual output as property. The public owns it. The public grants some limited rights to the creator, but ownership isn't one of those rights.
posted by willnot at 10:19 PM on December 12, 2002

So how does the author feel about shoplifting?

You can find out by reading the article.
posted by muckster at 10:19 PM on December 12, 2002

The public grants some limited rights to the creator, but ownership isn't one of those rights.

It seems with piracy the one thing the public isn't granting is control of how the creator want to have his output distributed. The public is forcing creators to distribute their output in the way the public wants.
posted by gyc at 10:23 PM on December 12, 2002

The public is forcing creators to distribute their output in the way the public wants.

Of course - why should the creator be able to control that? The idea is to get ideas and innovation for the benefit of the public not for the benefit of the creator. Any benefits granted the creator are secondary and only material in so far as they encourage production. Production that is kept locked away though? Well, who needs that - better no copyrights at that point.
posted by willnot at 10:30 PM on December 12, 2002

Sigh. Didn't read down far enough.

/me slaps himself around a bit.

It looks like he feels the same way about shoplifting, doesn't it? He's not concerned about the cost to the merchant ("an annoying cost of doing business"), only that it might reduce his own sales because it misleads electronic inventory systems.

The writer makes some good points, but he seems not capable of understanding anyone's position but his own.
posted by Slithy_Tove at 10:56 PM on December 12, 2002

At any rate, I doubt you'll find a lot of destitute people with access to cable modems to download songs.

Well, I doubt you converse with many university students. I really don't have the money to buy many cd's but do have broadband access for free due to the school. College campuses are widely seen as the biggest consumers of pirated materials.

How many people that can't afford $20 can afford a computer even with dial-up access?

How many college students do you see working multiple jobs on top of classwork? They're not doing it to buy cd's, bud. Plus, most schools will provide a student with a PC or at the very least access to a PC.
posted by ttrendel at 11:07 PM on December 12, 2002

It seems to me that it would be quite easy for the record companies to compete with Kazaa and the others without having to sue them. Let's face it: Kazaa sucks and the others aren't much better. It's slow, there's queues for everything, the software is buggy and chock full of spyware, and it is no longer possible to find much outside of pop, rock and trendy alternative bands that trendy net people like. It's nothing like the heyday of napster where you could find super-obscure world music artists, or tracks from out of print or imported jazz albums. Even mainstream jazz is getting harder and harder to find. And classical music? forget it, unless its on "the top 100 classic hits of all time." The last service that offered anything close to this was audiogalaxy and it's gone too now.

All the record companies need to do is open a service like audiogalaxy or napster, give it lots of bells and whistles, stock it full of as much music as they can buy hard drive space for and charge a reasonable price for it. Kazaa and the others would still survive of course, but they wouldn't pose nearly the threat to the music industry that they do now.
posted by boltman at 11:13 PM on December 12, 2002

The God Complex...I think we simply disagree on the concept of IP. As far as I'm concerned, IP is no different from knowledge - that is, it's a public good. If I give a speech, and you repeat it without paying me, why not? It's entirely different from shoplifting in that the singer loses zero when I download the CD. Shoplifting, on the other hand, imposes costs on the artist and/or label.

The oft-cited Salon article notes that 1.5x as many songs were downloaded as bought, yet the decrease in sales of CD's was no more than one would expect in a down economy. From an economic efficiency standpoint, I'd say that's a pretty good deal.

The fact is, it's entirely not the artists choice who hears and doesn't hear the album. What is created is non-exclusionary, as non-exclusionary as my hypothetical speech. A CD label provides a service - giving high-quality, consistent copies of the music. The music is not what is being sold.

I'm not going to lie - I have 4000 something mp3's, and I rarely buy CD's (the most recent was a charity benefit from Femi Kuti). I don't see anything unethical in it. I still support my favorite artists at concerts. But even if the artist saw no money from me, there's nothing inherent in making music that says you should be paid for it, whether or not someone derives benefit from that music.

So I post this, knowing I won't see a cent from it, despite my hard work. I hope it provides some benefit.
posted by Kevs at 11:28 PM on December 12, 2002

and after posting...
boltman, I agree entirely. The selection on Kazaa leaves much to be desired. I use it sometimes, ftp sometimes, but Iwish there was still audiogalaxy.
posted by Kevs at 11:29 PM on December 12, 2002

In the latter two cases, I don't think you'll find all that much complain from anybody for downloading the music.

Where 'anybody' excludes the RIAA, their supporters in Congress, and the plenty of others who insist on seeing this issue in black and white rather than several thousand shades of grey.

College campuses are widely seen as the biggest consumers of pirated materials.

Which is a key point. The 20-30-something home broadband users aren't the ones downloading Britney by the albumload; college is about the last time most people pay much attention to teen popstars. The RIAA no doubt recognises that the confluence of high speed net access and low income that drives mass-downloading is a temporary situation for most people, but feel they can't afford to lose that steady flow of teen spending. Older consumers are more discerning and demanding, and much more difficult to market to.
posted by rory at 4:06 AM on December 13, 2002

Kevs: As far as I'm concerned, IP is no different from knowledge - that is, it's a public good.

Copyright does not protect ideas, only specific expression of ideas.

It's entirely different from shoplifting in that the singer loses zero when I download the CD. Shoplifting, on the other hand, imposes costs on the artist and/or label.

This is a conclusory argument that gets bandied around all the time but I have yet to hear good reasoning to support it.

If I give a speech, and you repeat it without paying me, why not?

Unless it has been "fixed in a tangible medium" anyone can repeat it ad nauseum.

I highly, highly recommend that anyone interested in these issues read Lawerence Lessig's Code and his latest, The Future of Ideas. He shows the possibility of being for reasonable IP protection while addressing the problems that the Internet posses for copyright owners.
posted by anathema at 5:37 AM on December 13, 2002

poses.
posted by anathema at 7:56 AM on December 13, 2002

no, no, "Internet Posses" is cool -- there must be a MeFi tagline there
posted by matteo at 10:19 AM on December 13, 2002

anathema: If I steal a piece of music on a physical CD, the artist can show a loss because without the item on the shelf it cannot sell to anyone, and there is the additional cost to produce a new physical CD to replace the shoplifted one.

If I copy a piece of music digitally, the artist cannot claim a loss because it cannot be shown I would have purchased the music in the absence of the capability to download it. Perhaps I would simply have refrained from buying, or I would have bought something else.

This is the core quandry of intellectual property. If I have a widget and I give it to you, I no longer have my widget. If I have and idea and I give it to you, I still have my idea. Why we persist in applying law analagous to the law of physical property to insubstantials is anyone's guess.
posted by Cerebus at 12:27 PM on December 13, 2002

Well I thought we lived in a free market. And in this free market the RIAA thinks consumers will pay $20 dollars for something which as a market value of around $3. The internet has changed the way we disseminate information. Instead of inovating the record companies are suing, and in the end they will lose. The greedy bastards.
posted by elwoodwiles at 1:38 PM on December 13, 2002

the artist cannot claim a loss because it cannot be shown I would have purchased the music in the absence of the capability to download it. Perhaps I would simply have refrained from buying, or I would have bought something else.

Well, I'm no economist, but I'm fairly sure that an economist would disagree with this bit of logic. The cost that you impose on the artist in statistical terms is the amount of the lost sale discounted by the probability that the download prevented the sale. So if the CD costs $20, and downloading the CD from the internet stops 20 percent of the downloaders from buying the CD, then, statistically speaking, each download robs the artist of 4 bucks. Sure, the artist can't prove that you cost her four bucks, but it seems somewhat beside the point, at least for the artist's perspective, whether 100 people are robbing her of $4 each or 20 people are robbing her of $20 each.

Now the argument that the pro-filesharers make is that the loss suffered by people not buying CDs because of filesharing is offset by the number of people that buy CDs thanks to being exposed to artists that they never would have heard otherwise. This strikes me as pretty unlikely to be true, although not inconceivable. It make cause a lot of people to make different purchases then they otherwise might have, but I doubt it causes many people to purchase more. One thing that does seem likely though is that big-name artists are probably losing the most, while small artists are much more likely to have losses offset by winning over new fans. So, as far as that's true, it could wind up acting as a positve counterweight to the increasing tendency of record labels to pour their resources into a few (usually lame) big name artists.

Still, at this point the effect of filesharing on the record companies is probably pretty tiny, since relatively few people have access to broadband, and the majority of those that do probably neither buy or fail to buy because of filesharing. The real question is what happens when broadband becomes as ubiquitous as dial-up.
posted by boltman at 3:35 PM on December 13, 2002

boltman, thanks for the economic analysis.

If I have a widget and I give it to you, I no longer have my widget. If I have and idea and I give it to you, I still have my idea. Why we persist in applying law analagous to the law of physical property to insubstantials is anyone's guess.

But the widget has less economic value even if I still have it, and IP rights are economic rights. If I spend six months (and thousands of dollars) creating a painting, writing and producing a song, or even building a better mousetrap, I want to be sure that I can exclusively control the economic exploitation of my creation for a reasonable period of time. If the terms are reasonable, then IP rights benefit everyone, not just content owners. (see Lessig books above). Because of the quid pro quo that accompanies the IP clause in the Constitution we are a richer (culturally and economically) society. The Eldred case is one example of the continuing struggle to maintain a balance between creators and the public.
And by the way, no one has mentioned the loss to the artist when it comes renegotiating a contract.
If the US system were based on a continental system then not only would this discussion be solely about copyright, but also about the non-economic factors involved with artists rights (droits moral) which make the use of copyrighted works even more difficult in most of europe. We generally have more safeguards in our copyright system to protect certain unlicensed uses than the rest of the developed world.
posted by anathema at 3:48 PM on December 15, 2002

Here's the follow up to the original linked article.
posted by anathema at 10:27 PM on December 15, 2002